Arby's may make move into retail

Arby's, which has struggled to drive sales in its restaurants, may extend its reach by offering branded products in grocery stores.

The 3,700-unit chain said Friday that it had signed a deal with Nancy Bailey & Associates Inc., an Atlanta licensing firm, to begin fielding offers to sell packaged Arby's items on supermarket shelves.

Arby's spokeswoman Kathy Seifert confirmed the chain would seek to sell its products in retail settings, but she declined to offer details on what would be sold. She noted that the brand previously had licensed its sauces for retail.

The leveraging of restaurant brands in the retail market can be lucrative for chains, earning millions of dollars and creating additional revenue streams, said Bill Cross, a vice president at Broad Street Licensing Group, which is not involved in the Arby's deal.

Several restaurant concepts have entered the retail market or increased their grocery offerings as sales slowed in their dining room, including P.F. Chang's, Burger King, California Pizza Kitchen, T.G.I. Friday's, Jamba Juice and Starbucks.

Arby's has had difficulty reversing falling sales, with parent company Arby's/Wendy's Group reporting an 11.5-percent dive in same-store sales at the roast beef chain for the April 4-ended first quarter.

In May, Wendy's/Arby's Group tapped industry veteran Hala Moddelmog as Arby's new chief executive and charged her with executing a turnaround at the chain.

Separately last week, Wendy's/Arby's Group chairman Nelson Peltz disclosed that he had received an inquiry expressing interest in the acquisition of the fast-food company, according to documents filed with the U.S. Securities and Exchange Commission.

Peltz, whose Trian Fund Management LP owns 23.5 percent of the company, said he is considering the offer, which was made by an unnamed third party.

Contact Elissa Elan at [email protected]